I want to bring in Michael Mccaul. The chair of the house homeland security committee. Mr. Chairman, thank you for joining us this morning. Thanks, George. You have seen the intelligence. Do you believe Isis poses the threat general Allen talked about and do you support what he's calling for? I do think they represent the greatest threat since 9/11. This has been festering for a year. Now it's culminated in the killing and beheading of an American journalist. I think it is a turning point for the American people. It's opened the American people's eyes to what the true Isis is. How salve that -- savage they really are. And their intent to harm Americans. Their words, we'll drown Americans in their own blood. We'll raise the black flag of Al Qaeda over the white house. They're intent not only in establishing the caliphate over there, they're intent on expanding that to external operations not only in Europe. They would love the hit the United States of America. Congressman, if we get the kind of expansion you and general Allen are talking about, wouldn't that require a new authorization from congress? The 2001 authorization targeted Al Qaeda. Not Isis. It would be a real stretch to put this under the Iraq authorization. Won't congress have to act here? We believe that the administration should be in consultation with congress. So far, they have under the war powers act. Once that period of time expires, we believe it's necessary to come back to congress to get additional authorities and to update, if you will, the authorized use of military force. With respect to general Allen's comments on regional strategy, I wholeheartedly agree. I believe that America, the United States should not bear this burden alone. We have regional allies. We have allies that can bring a lot of pressure on Isis. I don't think you'll win this with a containment policy alone. This administration, thus far, has only dealt with containment. We need to expand the air strikes to ultimately defeat and eliminate Isis. I would rather eliminate them over here than have to deal with them in the United States. How serious a threat do they pose to the homeland right now? Their focus right now is to establish the caliphate. There are external operation under way, I believe. The biggest threat, George, is this. Unlike Afghanistan and Pakistan, this is very accessible. We have tens of thousands of foreign fighters from all over the world pouring into this safe haven that's now been established, including hundreds of Americans with western passports and legal travel documents, which would enable them not only the travel to western Europe, but to the United States. And then you couple that with their now newly formed alliance announced a couple of days ago with aqap in Yemen, which is the premier Al Qaeda bombmaker. You have a threat to airlines blowing up. And the traditional times square bomber we saw in New York. So I believe the threat is very real. I think the FBI, homeland security officials believer it's real. That's why they sent out a be on the lookout to state and local officials for suspicious activity and on social media, which they're very adept at doing. Mr. Chairman, thank you for your time. Right to Richard Clarke. You say the United States has got the act right now as if it's already been hit. I think we have to imagine ourselves a month from now, six months from now in within attack in New York. And then we say, boy, I wish I had done something back then. Why aren't we doing it now? Why wait for it to happen? There is no evidence of a plot right now. There's no evidence of people having come back from the theater. But we might not know. Our system is good. Much better than 2001. It's not 100%. We won't know, perhaps, until something goes off. There seems to be debate inside the administration, Martha, about how serious this threat is to us right now. You heard chuck Hagel say it was a threat to everywhere, anywhere. I'm not sure everyone agrees. This is more of a conventional army with Isis. They have equipment. Trying to take territory. They want to establish a caliphate over there. If we get in the way, if America gets in the way, if western powers get in the way, then they'll go after us. In terms of imminent to this country, the FBI says not right now. We were all struck by the horrific pictures of James Foley which led to the question of whether or not the United States should be paying ransom for the hostages. I want to bring that to rakmini callimachi. You had a story a few weeks ago where you had Europe bankrolling Al Qaeda terror. Owe you -- you wrote Al Qaeda and its direct affiliates have taken in at least $125 million in revenue from kidnappings since 2008, of which $66 million was paid just last year. The United States says it does not pay ransom. The european government denies it as well. It appears the european have paid it in some fashion. Ye, absolutely. It's clear from my reporting that european governments are paying ransoms. They're doing it through a system of proxiproxies. In north Africa, they were able to hide the ransom payments as a humanitarian aid payment to the country where the hostages are being held. And the money is transferred to the terrorists by the host country. It is a growing problem. And, as colleagues have said, I think it needs to come out of the shadows. I think Europe needs to own up to what they're doing. And we need to have a frank discussion about this, because, what's happening now is that if an American citizen or a british citizen, another country that does not pay, if they are taken alongside europeans, they are the most likely to be killed. Because we don't pay. You talk about this being a hidden debate. I think that's exactly right. Do you see any sense that the europeans are rethinking their policy? Not really. We have just had, I mean, we have just had more than a dozen european hostages released from Isis custody. They've been paid to have them released. There's two young Italian women who have recently been kidnapped. We're already hearing stories about Italian officials on the border with Turkey and Syria looking for a go-between to get the ransom money across. Okay, rukmini callimachi, thank you. I know you have more reports coming. Richard Clarke, let me bring that to you. Her report about the bankrolling of terror. Isis has become such a well-financed group. It's been well-financed in part because it's taken over territories that had banks in it. This issue of paying for hostages is a very tough one. No one wants their loved one to be killed. They want to do everything when it's them. If any American, any brit, anyone from Europe pays, then we're all at risk. Then we all become targets. Those of us who travel in the middle east. We can't pay. No rethinking on the part of the administration? I don't think so. It is something that should be debated and looked at. But it's a complicated issue. And it's true. If you start paying, they'll probably take more. Thank you, Richard Clarke and Martha Raddatz.

This transcript has been automatically generated and may not be 100% accurate.

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